Apple Sells A Record Number Of iPhones, Beating Expectations As Cash Hits A Quarter Trillion Dollars

Tyler Durden's picture

Rumors of AAPL's demise have once again been greatly exaggerated. Moments ago, Apple reported Q1 earnings which not only beat on the top and bottom line, but also sold a record number of iPhonea in the quarter at a record 78.4 million, 2 million more than expected, at higher ASPs than expected. Earnings of $3.36 were higher than the $3.22 expected, on record revenue of $78.4 billion, above the $77.3 BN expected, and 3.3% higher than a year ago. While sales grew across the globe, revenue in China declined by 12% in the quarter, the 4th consecutive quarterly decline in a row.

“We were surprised by the strength of iPhone 7 Plus where we were actually short of supply throughout the quarter. We’ve been able to come into supply-demand balance in January," Chief Financial Officer Luca Maestri told Bloomberg.

The result in a nutshell:

  • Q1 EPS: $3.36, Exp. $3.22
  • Q1 Revenue: $78.4Bn, Exp. $77.3Bn
  • Gross margin: Exp. 38.4%
  • iPhone unit sales: 78.3 milion, Exp. 76.3 million. iPhone sales generated $54.4 billion in revenue, 69% of total.
  • iPhone average selling price: $694.6, Exp. $688

Putting Apple's numbers in context: in Q1 2017 iPhone sales generated 69% of the company's total revenue. This compares to 2.5% in Q1 2008.

The only fly in the ointment appears to have been a modest cut to
guidance, as it now expects to generate Q2 revenue of $51.5BN to
$53.5BN, beow the $53.8BN expected.

In an interview, Apple CFO Luca Maestri said that app store sales increased 40% y/y in the quarter. Apple also provided the following guidance for its fiscal 2017 second quarter:

  • revenue between $51.5 billion and $53.5 billion
  • gross margin between 38 percent and 39 percent, Exp. 38.7%
  • operating expenses between $6.5 billion and $6.6 billion
  • other income/(expense) of $400 million
  • tax rate of 26 percent

Tim cook was happy:

We’re thrilled to report that our holiday quarter results generated Apple’s highest quarterly revenue ever, and broke multiple records along the way. We sold more iPhones than ever before and set all-time revenue records for iPhone, Services, Mac and Apple Watch,” said Tim Cook, Apple’s CEO. “Revenue from Services grew strongly over last year, led by record customer activity on the App Store, and we are very excited about the products in our pipeline.”

The result in chart format:

While Apple revenue grew Y/Y, Net Income failed to rise from a year ago, dipping 2.6% to $17.9 billion from $18.4 billion, even as iPhone sales rose by 5% from a year ago.

Q1 Revenue of $78.4 billion was an all time high.

 

Product sales: a record number of iPhone sold in the quarter

 

Regional breakdown: sales grew in every region expect China where they declined by 11.6%

 

Finally, the company's record cash hoard grew once more, rising to $246 billion total, and $159 billion net. Most of this cash remains offshore.

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NugginFuts's picture

This news sucks.

Can we get back to the doom and gloom now?

nope-1004's picture

There is always "cash on the sidelines" for "better than expected" earnings and "record profit" in a Ponzi.

Even for craBapple.

 

back to basics's picture

Do these numbers ever get audited? Their suppliers indicated a cut back in orders but AAPL manages to report record sales. Are these iPhone put together out of thin air now? 

HowdyDoody's picture

Using zero-interest money to buy its own products to pump up shares prices would be unethical, right?

Antifaschistische's picture

Cash 215 to 246 - up 31 billion (impressive)

total liabilities 170 to 193 up 23 billion (also impressive..I'm using Y/E numbers for appl off of MSN.com)

...isn't there just something counterintuitive about a company that makes SO MUCH DAMN MONEY yet for some reason needed to BORROW $193,000,000,000 damn dollars!!

...maybe I'm just old school...buy buy buy

2_legs_bahhhhhd's picture

It's official.....the iPhone is now the worlds number one hand held device....replacing the penis

CheapBastard's picture

Who buys that crap?

 

I get a cheaper model that does everything I need for 1/5th the price. But I will admit i prob don't look as cool to all those wealthy angry Hillary supporters by carrying Brand X Phone and McDonald's coffee instead of the $700 iCrap and an $8 Starbucks.

I'm surprised none of those Hillary people haven't beaten me up yet.

However, I do cc a $1,000+ very nice Kimber instead.

There's that too.

Hongcha's picture

I have the Pro Carry II, stainless.  I like it very much.

1980XLS's picture

Bullish Kimber 1911.

Too bad not publically traded

nightshiftsucks's picture

I'm just poor white trash,I bought the STS2.It took about 1500 rounds to break it in but after that it's as reliable as my glock 17,I love it and it's very accurate.

just the tip's picture

if you are carrying a kimber, you should change the modifier of the marital status of you parents.

just out of curiousity, isn't carrying a kimber kind of like carrying a brick?  or maybe you enjoy being asked, "is that a kimber you are carrying or are you just happy to see me?"

monoloco's picture

Just think, if you hadn't blown over a grand on a pistol, and had bought Apple stock instead, you could have made some money today. By the way, what will your Kimber do that a $75 saturday night special won't?

twh99's picture

Apple is a publicly traded company and so yes their numbers are audited.

Consuelo's picture

 

 

Arthur Andersen...?

GUS100CORRINA's picture

APPLE must have done "RECORD CHANNEL STUFFING" as well as shipped product to George Soros so he can hand out phones to his contract rioters!!!

Based on these numbers, APPLE stock should have been up 20 points or more. Instead afterhours quotes are up only couple of points. Something smells rotten at APPLE.

Just one man's humble opinion. 

Abbie Normal's picture

Something is definitely rotten in the state of Cupertino -- apple magically sells more iphones while simultaneously cutting back on supplier orders.  There is much more to this story than has been revealed so far.

knukles's picture

OK
Here we go.  PizzaGate

https://www.wsj.com/articles/prosecutors-weigh-child-pornography-charges...

It's gotta start somewhere, at the bottom of the rungs, turning, slowly turning state's evidence .... 
Getting names.

CheapBastard's picture

Then...is Dominoes not going to unveil its Hello Kitty Pizza after all?

How about its "Pepperoni Podesta Pizza, Thick Crust?"

Jack Napier's picture

"This news sucks.

Can we get back to the doom and gloom now?"

 

This is doom and gloom. All these phones are spying on people, and the masses are buying them up in droves. I'm surrounded by zombies.

Hohum's picture

I'll believe Apple's demise when its store at the mall is less crowded.

Sages wife's picture

"You don't need a weatherman to know which way the wind blows"

order66's picture

Stop jumps on past earnings. Whoda thunk.

Obadiah's picture

Thanks Donald!!!

orangegeek's picture

LMFAO!!!!  Boot it into Q2 and START FUCKING CHANNEL STUFFING!!!

 

Sitting on store shelves is considered sales out for AAPL.

 

Most IT companies use their channels to do the same thing.

 

BTFiD

wmbz's picture

Fun with numbers!

Zero_Ledge's picture

FYI, Wolf guy is completely fake.  Don't waste your time reading about it like I did. :(

 

silverer's picture

Still going to build your stuff in the US instead of China? Seems like you have enough money to pay people. Or is it about what you can keep for yourself and away from the very people that made you successful?

TheRideNeverEnds's picture

We have entered a full blown recovery!

Buy stocks and houses now before you are priced out forever!

adr's picture

No, the death of Apple just keeps being papered over since too many jews own too much AAPL.

Record channel stuffed bullshit. 

So the greatest growth market for iPhones is Japan? 

Was the BOJ buying iPhones? 

I don't see anyone with iPhone7s. 

CheapBastard's picture

I just got back from South Korea and zero people there carry AAPL. It's 100% Samsung. Taiwan showed very very few AAPL. I have no idea why the Japanese are suckered into that status gadget.

DEMIZEN's picture

But still whining about H1B..

Kaiser Sousa's picture

total bullshit...

yeah - whateverthefuck u want us to believe CRApple...

south40_dreams's picture

Bye bye H1B's, enjoy life in the old country

ChargingHandle's picture

A bit surprising but I guess when their primary competitor Samsung was selling a phone that acted like bomb....they capitalized on it and got a an extra 2-3 point sale pop.

soyungato's picture

Yes but Samsung is gaining market shares in the Middle East for the reason you stated.

soyungato's picture

The US should sue Apple for using slave labor in China to produce their crap , then fine them $ 250 billions. 

If Jobs were alive , Apple would have new products by now. 

CheapBastard's picture

No wonder those CEOs in Silicone Valley fight like hell to maintain the asian child labor to make thes things for 10 cents an hour.

PrivetHedge's picture

Now that the iPhone7's such a success with the deleted headphone socket Apple will move on and delete the buttons, so that the 2018 model will have no screen either. That'll be a huge success due to the better battery life and cool look at the cafe tables.

U4 eee aaa's picture

New name too:

iPaperweight
iDoorstop

fanbois will heart it

Allen_H's picture

iDrink coaster.

iTable balance

I use a cheap non-smart phone, it is great, sits on the table 95% of the time gathering dust.

Fuck iCrap, overpriced spyware and snowflake machine.

Fake numbers.

silverer's picture

I'm still waiting for the next big idea, or are they now officially a phone company?

U4 eee aaa's picture

The Microsoft of phones. They will make money when they stop trying to tell people what they want and give them what they want instead

U4 eee aaa's picture

This clearly is a company that doesn't need corporate welfare in the form of HB1s